Companies that employ social media influencers for campaigns could yield higher returns compared to sponsored content.


Influencers are the new messengers for brands in the social media age — often eclipsing celebrities and magazine editors — as trusted authorities for all things fashion and beauty.

Just ask their millions of followers. Or the brands that are shelling out hundreds of thousands of dollars or even more than $1 million to work with a single influencer. But more than that, these individuals have become brands themselves, taking their million-plus followings on Instagram and YouTube and parlaying them into the next iteration of bloggerdom: entrepreneurship — specifically tech entrepreneurship, where business opportunities range from investing in startups to creating online-based businesses of their own.

Partnering with brands to host events and to create content, advertising and affiliate earnings should remain viable revenue streams, as the influencer set proved it can ink high-paying deals with fashion and beauty brands — but now they’re seeking ownership.

“They’re [influencers] becoming shareholders and equity partners and going into joint ventures. They’re doing things that have ownership and are not image [based],” said Jennifer Powell, head of Next Model Management’s influencer division, who works with Kristina Bazan, Julie Sarinana, Danielle Bernstein, Shea Marie and Caroline Vreeland. “They are young, they have all the followers. Of course these tech companies should be engaging these young girls who know how to use social media.”

That is the future of their personal brands, which Powell believes could be sustainable in the long term and yield higher returns than say, sponsored posts or designing capsule collections.

Take Russian digital influencers and street-style stars-turned-media entrepreneurs Miroslava Duma and Nasiba Adilova. Their highest-profile investment to date was participation in Reward Style’s $15 million round of funding last year. The two got on board to help globalize Reward Style’s affiliate network and Instagram commerce solution Like to Know It, and there is cross promotion with Duma’s Buro 24-7 fashion and lifestyle web site that has 10 franchised language versions.

Duma and Adilova invested in two more ventures together — Revfluence, a social media marketing company that pairs companies with the right influencer, and fashion brand Reformation. And then Adilova went on an investing spree of her own. Since last year, she’s amassed a portfolio of six additional investments that include Violet Grey; Bandier; Sweeten, a direct-to-consumer platform that pairs home renovation contractors with homeowners; Cake, a U.K.-based app that allows users to pay at restaurants without having to get a bill; Shiftgig, a temporary work app, and Bridge International Academies, an education start-up that uses technology to bring schooling to emerging markets in Africa (that also counts Bill and Melinda Gates as fellow investors).

But Duma and Adilova’s most recent focus has been building their children’s e-commerce platform called The Tot, which launched this summer. In November, ago, a corresponding brick-and-mortar store bowed in Dallas, where Adilova is based.

“You see a lot of bloggers doing magazine covers or photo shoots with brands, and unless it’s relevant to what I’m doing, business-wise, I don’t do it,” Adilova said. “There are two routes: one is that girls do sponsored posts and get paid — and make good money — and the other is to let me [use my social media following to] promote my business.”

She maintained that becoming a street-style fixture was an accident and happened purely by luck, but growing the social following that ensued — she has more than 90,000 Instagram followers — was intentional. She realized she could use social media as a tool to promote her businesses and investments.

We Wore What’s Danielle Bernstein invested in food and wine app Wine + Dine and Movie Grade, an app still in the beta phase that she said is “looking to replace Rotten Tomatoes.” She also helped open nightclub Nighty Night last year with Paige Hospitality Group.

“I have five different companies that I’m heavily involved in, besides [my blog] We Wore What,” Bernstein said, adding that the impetus for starting her site was to create a daily outfit inspiration. “I never wanted to be doing one thing, and I have so many other passions besides just doing my fashion blog.”

Chiara Ferragni of The Blonde Salad and Chiara Ferragni Collection and her cofounder and chief executive officer Riccardo Pozzoli are evaluating online investment opportunities. Already, the two started a food delivery service in Milan and sit on the advisory board of online fashion marketplace Depop, where they are also shareholders.

“In the next year, we will [get involved] in two to three other companies that are separate from The Blonde Salad,” Pozzoli said.

This isn’t to say that these influencers’ retail ventures aren’t an integral part of their businesses. Design projects that were once relegated to one-offs or capsule collections with existing brands and designers in blogging’s early days have become strong, and in some cases, thriving, stand-alone businesses.

In early November, Bernstein launched two retail brands online: Archive, a footwear collection carried exclusively at Shopbop, and Second Skin Overalls, a five-style collection of overalls. Her direct-to-consumer e-commerce destination secondskinoveralls.com moved about 1,500 pairs in the first month, according to Bernstein, who said the site did more than $80,000 in sales the first day.

Ferragni, Peace Love Shea’s Shea Marie and most recently, Man Repeller’s Leandra Medine — a namesake collection of footwear launched on Net-a-porter in October — are also building their brands through retail entities.

In some instances, like Ferragni’s Chiara Ferragni Collection of footwear, sales from product comprise the vast majority of her revenue. Her camp told WWD that her overall business hit almost $10 million in revenue in 2015, with about $7.5 million of that coming from her shoes.

The Blonde Salad Crew, or TBS Crew, includes 30 full-time employees, a 50 percent increase in staff since the beginning of the year, according to Pozzoli. He said 2016 is expected to close with 60 to 70 percent year-over-year growth in revenue, and next year will see a heightened focus on expanding the brand’s own retail footprint (a pop-up store in L.A. will be open until Jan. 4).

And don’t forget the tried-and-true personal appearances.

Fees from partnerships that require attendance on trips and at events no longer generate the majority of a blogger’s revenue, but it’s definitely become a secondary source of income for this group. Still integral to brands and retailers to have the support of the influencer community and the earned media they drive, the mostly five-figure deals (with the top echelon able to nab six figures) are a nice bonus.

Revolve was among the first companies to work with influencers in this way (the retailer started to work with Fashion Toast’s Rumi Neely in 2008), and this summer executed one of the most buzzed-about influencer activations of the year: a four-weekend-long summer house in the Hamptons that read as a who’s who of the blogosphere.

Raissa Gerona, vice president of brand marketing at Revolve, who oversees influencer strategy, maintained that working with influencers in this manner has been a cornerstone of Revolve’s strategy for nearly a decade. The company believes in long-standing partnerships and finding talent that resonates with its shoppers.

Gerona declined to disclose figures, but a source close to the company said rates for influencers ranged from about $50,000 to $200,000. That’s a handsome sum for the 40 or so bloggers who were each invited to stay at the Revolve house for a weekend. They were able to pick out clothes from revolve.com to wear during their stay and had no mandates to post anything to social media (unless they felt compelled to, of course).

“Well, look at the company — everyone knows about it,” Gerona replied when asked what return on investment Revolve has seen from such partnerships. “What we knew from the get-go was that they [bloggers] were going to be the next big thing. The biggest ROI was them growing our brand awareness.”

Something Navy’s Arielle Charnas, one of the 40 influencers who partnered with Revolve this summer, saw her profile — and net worth — soar this year. Her activewear collection created with Koral that was exclusively sold at Bandier, Something Navy x Koral, generated about $500,000 in sales and an event that drew over a thousand fans to Bandier’s Flatiron store in Manhattan this summer, according to Charnas’ team.

In June, she said, a sheet mask she posted on her Snapchat story drove $17,565 worth of product in 24 hours. This was thanks to six-month-old Emoticode, an app for tracking sales that come from Snapchat posts; Charnas was the launch partner for the app. The technology, created by PopSugar Inc. ceo Brian Sugar, serves as a tool to help bloggers and brands link to products in Snapchat stories that followers can screenshot and purchase later.

After a yearlong contract with TRESemmé that reportedly saw a payout of about $250,000 ended, Charnas signed with First Aid Beauty in October. She declined to disclose fees but called the new deal “one of the biggest partnerships I’ve gotten.” According to a source close to the brand, the fee from First Aid Beauty is comparable to that of the deal with TRESemmé, but requires a significantly smaller time commitment.

She’s just the latest proof that beauty eclipses fashion as the highest-paid gig for influencers. Kayture’s Kristina Bazan reportedly signed a seven-figure deal with L’Oréal Paris at the end of 2015 for this year, and Song of Style’s Aimee Song was said to have inked a $500,000 partnership with Laura Mercier in April. While Charnas’ deal is one of the largest between brand and blogger, it’s not the biggest deal of 2016.

But hey, there’s always next year.

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